Yes, sustainability may sound like a buzzword. And yes, perhaps the term is even used inflationarily.
However, this does not change the fact that it is essential to deal with the topic. You only have to look around on the WWW to come to the conclusion: A brand must deal with sustainability - without ifs and buts. It is not without reason that sustainable shares perform far better than less environmentally friendly ones. No matter where you look, sustainability is slowly becoming the only thing that matters.
Just take a look at Google: if you type in "sustainability brand", the search engine spits out 54,100,000 results - and the trend is rising.
As you can see, there is a need to talk. There are things that need to be done to stand out as sustainable in the brand jungle. Especially in times of climate change, it is urgently necessary to finally act green. How can you do that? Why your brand should also embrace sustainability? What exactly does that mean? Let's find out now.
What do my customers expect from my brand?
It should go without saying. But we like to mention it again: Your customers are the most important thing. Your product can be so exclusive, so special, so appealing - if your target group doesn't like something, you won't be successful.
That may sound simple. But anyone who has built or is building a successful brand knows there's much more to it than that. It's not enough to find out what your customers like - customer needs are a process that continues to evolve. There are now entire studies on what people look for in (online) shopping and what is really important to them:
For example, the ibi research institute at the University of Regensburg conducted a customer survey on shipping as part of the "e-commerce guide" project. The entire survey can be downloaded at this website download. In addition to the fact that the return rate is around 16% and 39% have cancelled an order due to chargeable returns, one result stood out in particular - you'll have guessed it:
A full three quarters of respondents would prefer environmentally friendly shipping. So one thing cannot be denied: Sustainability as a brand was important. Is important. And is becoming more important by the day.
Ibi research is not the only one to have found that customers prefer greener e-commerces. According to a survey conducted by statista Study among Internet users between the ages of 16 and 64, sustainability is becoming increasingly important as a brand. 26% of respondents between the ages of 19 and 26 said they boycott brands that are not sustainable enough.
The relevance of sustainability is increasing. And rising. And...
It is true that as early as 1998, the Treaty of the European Community laid down how sustainable development can and should take place. One of the major goals was - clearly - "combating climate change". But 24 years ago, climate change was apparently still far away. 24 years ago, there were no devastating floods in Germany or winters that felt more like spring.
No wonder that the rethinking is only now taking place. Climate change (or rather: climate crisis) is more tangible today than ever before. To ignore this major problem? Impossible. Fortunately, customers have been realizing for a few years now that they too have it in their hands to combat the climate crisis. How? By paying more attention to sustainable brands.
Also a EY Future Consumer Index survey clearly shows that something is happening! The priorities of our customers are (fortunately) shifting more and more in the direction of sustainability. For example, half of the respondents said they were willing to pay more for green products. In general, the study found that a full 68% of participants pay attention to the environmental impact of a product.
As you can see, the issue of sustainability is gaining in importance. According to a representative population survey 86% would even opt for greener shipping. What's more, if you Google "how to recognize sustainable products," you'll get 508,000 results. So the demand is there. What's missing now? Your offer! If that doesn't make you want to get involved with sustainability as a brand...
Sustainable companies do better business
You are not convinced yet? Are you wondering how useful it really is to become more sustainable? In order to determine this, key figures are usually consulted. However, it becomes clear that making sustainability measurable is not quite so simple when it comes down to the nitty-gritty: How do I actually determine whether sustainable companies are really doing a better job?
According to Handelsblatta look at the stock market is enough: For investors alone, it pays to pay attention to sustainability. The global stock index MSCI Worlds, for example, performed 14% worse than the benchmark index MSCI World ESG Leaders - the latter was reduced by the companies that were below average in sustainability.
The Paris two-degree target can also be used for comparison. Thus, companies whose targets are not compatible with the goal performed much worse than those that (would like to) comply with the Paris target: Less sustainable companies achieved a total return of 45.3% since 2013. The sustainable companies were even just under 86%!
These results are also consistent with a number of other studies. For example, LBBW found in a Investigation of 2018 found that sustainable (consumer) companies have a 3% higher EBIT margin on average than less sustainable companies. In addition, it was repeatedly confirmed that the corporate image suffers if the brand is not sustainable enough: companies such as "Mc Donald's, Burger King [...] and [...] some textile companies such as Primark or H&M" were at the bottom end in the perception of customers*. The reason? It's obvious: the brands lack sustainability.
Even in the infamous "war for talent," a brand that prioritizes sustainability comes out ahead. A study conducted by Nielsen Study has proven that more than half of the people who prefer to work for sustainable brands are under 35 years old. If you are looking for young talent and want to be perceived as an attractive, resource-conscious employer, there is no way around sustainability.
Being sustainable as a brand - (how) is that even possible?
To exaggerate, there are three types of brands:
- The conservatives. These are big brands that have been in the market for a long time and have been doing things the same way for years. Reason: "we've always done it that way".
- The innovative ones. These are brands that want to change something. They are still young and put a lot of emphasis on sustainability right from the start. For whom being green is anchored in the DNA.
- The willing. Brands that didn't have much to do with sustainability in the beginning, but are now doing everything they can to become greener.
For the sake of our planet and ourselves, let's hope that groups 2 and 3 are outnumbered. After all, it is more than time to tackle climate change and the growing, mostly unsustainable, addiction to consumption. But: How is this supposed to work at all? What can you, as a decision-maker of a brand that has not (yet) had much to do with sustainability, do?
There are various possibilities. To explain them all would go beyond the scope of this article. Nevertheless, we want to give you a few things that can also serve as inspiration:
- Be transparent. And, most importantly, avoid greenwashing. It does no one any good if you trumpet how important sustainability is to you as a brand - but then tons of CO2 are still being blown into the atmosphere with your shipping.
- Anchor sustainability in the team. Offer your employees benefits if they don't drive to the office. How about a city bike subscription, for example?
- Sustainable(er) Packaging. Ever thought about shipping your products in sustainable grass paper? Or switching completely to greener shipping? We have a suggestion...
How do companies implement sustainability?
The results of various studies speak for themselves: the needs of customers are changing. They no longer want "just" a top product or fast shipping - the brand should also prioritize sustainability. It should emit as little CO2 as possible, be aware of its social, economic and ecological responsibility and do something for the environment. Sounds like a lot of effort, doesn't it?
Yes, but the good news is that it doesn't have to be! Many companies have already taken the lead and show how fast and easy it can be to implement sustainability as a brand. The following companies are just a selection:
Patagonia: "The climate crisis affects us all". Always has.
Like no other company, Patagonia has shown that profit and sustainability can be reconciled. They uncompromisingly let us as customers know that we are all part of the Climate crisis (not 'climate change'...). And consequently we can all do something about it.
And Patagonia is leading the way as a prime example:
- they are transparent. For example, Patagonia mentions that a large part of their emissions - 95% - come from the supply chain. They take full responsibility for that.
- they are radical. Patagonia makes it clear on their website that carbon neutral is not enough: they do not advocate buying carbon offsets because that would not help in the long run. They also say that transforming their business is not enough. They call on communities to act - because they themselves, as a sustainable company, are only one lever among many.
- they tax themselves. Since 1985 (!), when sustainability was still a foreign word for many brands, Patagonia has committed to donate at least 1% of its sales to the environment. Thanks to this "Earth Tax", approximately 89 million US dollars have been donated to date.
- they call for repair. Under the slogan "Repair is the new new"Patagonia points out that enough textiles are already thrown away. They published repair instructions on their website and offer to take back old products for recycling.
We could continue the list forever. These are just a few examples of why Patagonia is a role model for so many brands that want to become more sustainable. Patagonia is uncompromising and knows exactly what matters. They don't just talk the talk, they walk the walk. They take responsibility - which basically every one of us has - for their actions. Greenwashing is a foreign word for them. And the most important thing is that it resonates with customers. Patagonia today has a corporate value of over one billion dollars. (Source: Ralph Stieber, Storyseller, p. 178)
Of course, Patagonia is an extreme example that is not so easy to emulate. It is a brand where sustainability has been anchored since the beginning. Nevertheless, a better inspiration to become more sustainable is hard to find.
einhorn: The Fairstanability approach. After questioning one's own products.
Founded in 2019, the Berlin-based startup is not as big as sustainability giant Patagonia - but it is at least as committed. The company specialises in sustainable condoms and period products. On their website, they explain transparently how everything started: In the beginning, there were only tampon and condom blanks on which they had stuck their logo. It soon became clear: sustainable? Not so much... After all, they could not know where the products came from and by whom they were processed.
After some time, however, the brand took the next, most important step towards sustainability. They make all the problems in the life cycle of their products their problems as well, so they take responsibility. Although, as they say themselves, "it sounds like [they] are the absolute golden-haired little angels at the Sustainability heaven", einhorn also knows: There's still a lot to do!
One of their approaches is the so-called fairstanability approach. In plain language: einhorn does not keep 50% of the profits for itself, but reinvests them in projects along its supply chain. In this way, rubber workers can be paid 15% more wages, for example. But that's not all. einhorn also tries to be as transparent as possible, which is why it even asks the community for advice: "Do you have ideas on how we can map our progress [...]?"
So what can you learn from Einhorn? Nobody's perfect. A little sustainability as a brand is better than none at all. Ask your community, donate a part of your sales, pay attention to your supply chain...
Porsche: Sustainable car driving. Although the machines were powered by petrol for a long time.
It may be hard to believe. But yes: even car manufacturers can change their route, as Porsche impressively proves with its Sustainability Strategy 2030. The goals: Decarbonisation, circular economy, diversity of perspectives, commitment to society, sustainable supply chain, governance and transparency. Porsche sees itself as a pioneer when it comes to sustainability - and shows that even the (usually not environmentally conscious) automotive industry has what it takes to become more sustainable. If only one wants to.
Among other things, Porsche is focusing on electric mobility. By 2025, half of all new Porsche models are to be equipped with an electric motor. And at the moment, it looks like the company is on a very good path: even before its world premiere in 2019, demand for the first electric Porsche, the Taycan, was enormous. By the end of 2019, Porsche had 10.000 signed concrete Taycan purchase contracts by the end of 2019.
This also shows two things: The demand is there. Customers want to be sustainable, they are almost waiting for it. And it is indeed possible for a car brand to focus on sustainability.
Of course, companies can't become as sustainable as Patagonia overnight. Intensively questioning the supply chain, as Einhorn does, also takes a lot of time and energy. Just like turning around a company that for years had little to do with sustainability. Nevertheless, I think we can all agree on one thing: doing something is better than doing nothing. Especially considering the fact that sustainability is becoming more important to your customers every day.
The good news: You too can breathe sustainability into your brand. Start with the little things. Maybe start by setting a goal you want to achieve. And then take it one step at a time. How you can easily implement sustainability, we have compiled for you in our guide for you.
By the way: You don't have to do everything alone! At Liefergrün, for example, we specialize in green, sustainable and customer-friendly shipping.
It's not "just" saving CO2 over the last mile - because even the non-measurable impact is big. Rather, it's about improving your image with your customers. It's about the smile you elicit from them when they are happy about the sustainable shipping. And the positive impact you have on our environment. Are you ready to take the next step into a more sustainable future with us?